Worcester City Council bucks city manager, open to mediation on foreclosures

Steven H. Foskett Jr., TELEGRAM & GAZETTE STAFF

Published Tuesday August 20, 2013 at 9:44 pm

WORCESTER — The City Council decided Tuesday night not to follow the city manager's recommendation against adopting a mandatory foreclosure ordinance.

The council instead decided to give a hearing to the idea of forcing banks to sit down with homeowners before they foreclose on properties.

"It could be a great opportunity to have open discussion, to get the right language, to get it before this body, and vote on this once and for all," said District 4 Councilor Sarai Rivera.

City Manager Michael V. O'Brien recommended against the ordinance because of the legal and financial barriers to taking on what he described during the meeting as "banks too big to fail."

Mr. O'Brien said Tuesday more tools at the state and federal level are what is needed. He said the city is at the "bottom of the food chain" of the foreclosure crisis.

Councilor-at-Large Konstantina B. Lukes said that the council can pass all the ordinances it wants, but said they will likely get sued and lose. She agreed with Mr. O'Brien that pressuring state lawmakers for more anti-foreclosure tools is a more sound strategy.

"There is nothing forcing the banks to comply with anything," she said.

But several councilors disagreed.

District 3 Councilor George J. Russell said Mr. O'Brien's recommendation against the ordinance was "one of the most disappointing reports to come out of this administration."

Mr. Russell said he was hoping to at least see a "plan B" proposal from the administration to deal with foreclosures.

"We owe it to the residents of this community to try to fight," Mr. Russell said.

District 1 Councilor Tony Economou said foreclosures contribute to blight in neighborhoods, and said preventing just one house on a street from going into foreclosure will make a big difference in a neighborhood.

"We need to take steps to sit down, to have people sit across from the bank," Mr. Economou said. "You can negotiate over phone, or over the computer, but when you're person to person, that's the change — it brings the human element back into the conversation."

Mr. O'Brien described the uphill battle the city often faces dealing with banks that foreclose on homes in the city. He said the best responses the city gets from the banks are often "half-baked," if they can even be reached by phone. He said the banks pretend they don't own properties.

"They just don't care," Mr. O'Brien said.

District 2 Councilor Philip P. Palmieri said he wondered if councilors really know what it's like to lose a home to foreclosure and the "depth of despair" it causes residents.

He acknowledged that it appears that most of the council has taken a different position than the manager on the foreclosure mediation issue. Meantime, people will continue to lose their homes, Mr. Palmieri said.

The council voted to send the mandatory foreclosure mediation issue to the Economic Development committee for a hearing.

In his original report to the council, the city manager said the city will continue to work with all partners, both public and private, to ensure that all homeowners are aware of their rights and provided support in their efforts to legally retain their homes.

A grass-roots group, the Worcester Anti-Foreclosure Team, broached the idea of the mediation ordinance to the City Council in October, and it was supported by several city councilors. It pointed out that between its initial request in October and its renewed plea in April, 403 households in the city went through foreclosure.

Also Tuesday, the council got an earful from residents upset with recent changes to Worcester Regional Transit Authority bus routes. Some routes have been cut from once every half hour to once an hour, and other routes have been eliminated or shortened, they said. A petition with around 700 signatures was presented to request route changes.

School Committee member Tracy O'Connell Novick said she took the bus to the meeting with her children. They had to take a different bus because the first one was late, and would have to leave the meeting by 8 p.m. to catch the last bus home. She asked councilors to try to do their jobs while using public transit.

Mr. Palmieri said there will be an opportunity for further public input on WRTA bus routes at 5 p.m. Sept. 12.

"Hopefully, by that time there will be some change," Mr. Palmieri said.